Since the election earlier this year and the formation of a government of national unity, a sense of optimism has emerged in South Africa, with many believing that the residential property market could soon benefit from a more stable political environment.
Lightstone's analysis of the volume and value of residential sales in the two six-month periods in 2023, and the first half of 2024 shows that the residential property market is still sluggish. Volumes and value (see graph below) are both marginally down in the first half of 2024 (H1) (103 000 properties, R139.5b) compared to the same period last year (104 500 properties, R144b), both of which were down on the second half of the year (H2) in 2023 (106 000 properties, R146b) - the number of bonded sales and the percentage of bonded sales are also down.
Volume and value of residential sales
Positive signs
Negative sales declining
Despite the overall decline in sales, there are some positive signs. The proportion of negative sales, where the property sells for less than it was bought for, has decreased from the second half of last year's levels, suggesting a potential easing of the tough conditions homeowners have faced since Covid.
First-time buyers
Additionally, while the increase is marginal, first-time buyer (FTB) numbers are up on the 2023 H1 and 2023 H2 numbers. Although the variance is barely noticeable, it suggests a stability in the market over 18 months.
Sales volumes and values and SA's property market
The property market's performance comes against a backdrop of a small increase in both the volume and value of residential stock available. In August 2024, there were 7 050 000 properties registered at the Deeds Office, representing a marginal increase from the previous year. The total value of South Africa's residential property market reached R7 trillion in August 2024, up slightly from R6.8 trillion in August 2023.
Price band comparisons
Other than under R250k price band, the market in the first six months of 2024 underperformed relative to the last six months of 2023, and in most cases, the first six months of 2023.
Sales volume per purchase band
Sales value per purchase band: Rb
Volume, value, and average per property type
Sectional scheme sales volumes were marginally up in the first six months of 2024 (33 000) compared to the corresponding period in 2023 (32 000). Freehold sales volumes were slightly down (54 000) in the first six months of 2024 compared the same period in 2023 (55 000). Similarly, Estate sales also fell to just under 16 000 in 2024 from just over 17 000 in 2023.
Sales volume per property type
Sales value per property type: Rb
Movement between provinces
Despite the overall flat market, the Western Cape continues to outperform other provinces in attracting homeowners (see Only one in 4 sell-to-buy homeowners move to a new province. However, as illustrated by the graphs below, Gauteng remains South Africa's largest province in both sales volume and value of transactions over the past three six-month periods.
Sales volume per province
Sales value per province: Rb
